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Full text of "D208166519"

Electronically Recorded 



Tarrant County Texas 



Official Public Records 



2008 May 06 03:28 PM 
Fee: $ 32.00 



D208166519 



Submitter: SIMPLIFILE 



5 Pages 



Project: River Trails 
Lease Id: 25070 



Suzanne Henderson 




STRIKE ANY OF 
IN THE PUBLIC 



PAID UP OIL AND GAS LEASE 




SEE EXHIBIT "A" ATTACHED HERETO FOR DESCRIPTION OF LEASED PREMISES 




3 Royalty Payment. Royalties on oil, gas and other substances produced and saved hereunder shall be paid by Lessee to Lessor as 
iollows: (a) For oil and other liquid hydrocarbons separated at Lessee's separator facilities, the royalty shall be One-Quarter (1/4) of 
such production, to be delivered at Lessee's option to Lessor at the wellhead or to Lessor's credit at the oil purchaser's transportation 
facilities, provided that Lessee shall have the continuing right to sell such production to itself or an affiliate at the wellhead market 
price then prevailing in the same field ( or if there is no such price then prevailing in the same field, then in the nearest field in which 
there is such a prevailing pnee) for production of similar grade and gravity; (b) for gas (including casinghead gas) and all other 
substances covered hereby, the royalty shall be One-Quarter (1/4) of the proceeds realized by Lessee from the sale thereof provided 
that Lessee shall have the continuing right to sell such production to itself or an affiliate at the prevailing wellhead market price for 
production of similar quality in the same field (or if there if no such price then prevailing in the same field, then in the nearest field in 
which there is such a prevailing price) pursuant to comparable purchase arrangements entered into on the same or nearest preceding 
date as the date on which Lessee or its affiliate commences its purchases hereunder; and (c) in calculating royalties on production 
hereunder, Lessee may deduct Lessor's proportionate part of any production and excise taxes. If at the end of the primary term or any 
time thereafter one or more wells on the leased premises or lands pooled therewith are capable of producing oil or gas or other 
substances covered hereby in paying quantities, but such well or wells are either shut in or production therefrom is not being sold by 
Lessee, such well or wells shall nevertheless be deemed to be producing in paying quantities for the purpose of maintaining this lease. 
If for a period of 90 consecutive days such well or wells are shut in or production therefrom is not being sold by Lessee, then Lessee 
shall pay an aggregate shut-in royalty of ten dollars per net mineral acre then covered by this lease, such payment to be made to Lessor 
on or before the end of said 90-day period and thereafter on or before each anniversary of the end of said 90-day period while the well 
or wells are shut in or production therefrom is not being sold by Lessee; provided that if this lease is otherwise being maintained by 
operations, or if production is being sold by Lessee from another well or wells on the leased premises or lands pooled therewith, no 
shut-in royalty shall be due until the end of the 90-day period next following cessation of such operations or production. Lessee's 
failure to properly pay shut-in royalty shall render Lessee liable for the amount due, but shall not operate to terminate this lease. 
Lessee may not maintain this Lease in effect solely by the payment of shut in royalties for (i) any one period of more than Two (2) 
consecutive years or (ii) for shorter periods during times all wells are actually and physically shut in from time to time not exceeding 
Five (5) years in the aggregate. 

4. Shut-in Payment. All shut-in royalty payments under this lease shall be paid or tendered directly to Lessor at the above address, or 
its successors, regardless of changes in the ownership of said land. All payments or tenders may be made in currency, or by check or 
by draft and such payments or tenders to Lessor by deposit in the U.S. Mails in a stamped envelope addressed to the Lessor at the last 
address known to Lessee shall constitute proper payment. 

5. Operations. If Lessee drills a well which is incapable of producing in paying quantities (hereinafter called "dry hole") on the leased 
premises or lands pooled therewith, or if all production (whether or not in paying quantities) permanently ceases from any cause, 
including a revision of unit boundaries pursuant to the provisions of Paragraph 6 or the action of any governmental authority, then in 
the event this lease is not otherwise being maintained in force it shall nevertheless remain in force if Lessee commences operations for 
reworking an existing well or drilling operations for an additional well or for otherwise obtaining, restoring or increasing production 
on the leased premises or lands pooled therewith within 90 days after completion of operations on such dry hole or within 90 days 
after such cessation of all production. If at the end of the primary term, or at any time thereafter, this lease is not otherwise being 
maintained in force but Lessee is then engaged in drilling, reworking or any other operations reasonably calculated to obtain, restore 
or increase production therefrom, this lease shall remain in force so long as any one or more of such operations are prosecuted with no 
interruption of more than 90 consecutive days, and if any such operations result in the production of oil or gas or other substances 
covered hereby, as long thereafter as there is production in paying quantities from the leased premises or lands pooled therewith. 
After completion of a well capable of producing in paying quantities hereunder Lessee shall drill such additional wells on the leased 
premises or lands pooled therewith as a reasonably prudent operator would drill under the same or similar circumstances to (a) 
develop the leased premises as to reservoirs then capable of producing in paying quantities on the leased premises or land pooled 
therewith, or (b) protect the leased premises from uncompensated drainage by any well or wells located on other lands not pooled 
therewith. There shall be no covenant to drill exploratory wells or any additional wells except as expressly provided herein. 

6. Pooling. Lessee shall have the right, but not the obligation to pool all or any part of the leased premises or interest therein with any 
other lands or interests, as to any or all depths or zones, and as to any or all substances covered by this lease, either before or after the 
commencement of drilling or production whenever Lessee deems it necessary or proper to do so in order to prudently develop or 
operate the leased premises, whether or not similar pooling authority exists with respect to such other lands or interests. The creation 
of a unit by such pooling shall be based on the following criteria (hereinafter called "pooling criteria"): A unit for an oil well (other 
than a horizontal ) shall not exceed 40 acres plus a maximum acreage tolerance of 10%, and for a gas well or a horizontal completion 
shall not exceed 640 acres plus a maximum acreage tolerance of 10%; provided that a larger unit may be formed for an oil well or gas 
well or horizontal completion to conform to any well spacing or density pattern diat may be prescribed or permitted by any 
governmental authority having jurisdiction to do so. For the purposes of the forgoing, die terms "oil well" and "gas well" shall have 
the meanings prescribed by applicable law or the appropriate governmental authority, or if no definition is so prescribed, "oil well" 
means a well with an initial gas-oil ratio of less than 100,000 cubic feet per barrel and "gas well" means a well with an initial gas-oil 
ratio of 100,000 cubic feet or more pre barrel, based on a 24-hour production test conducted under normal producing conditions using 
standard tease separator facilities or equivalent testing equipment; and the term "horizontal completion" means an oil or gas well in 
which the horizontal component of the gross completion interval in die reservoir exceeds the vertical component thereof. In 



Project: River Trails 
Lease Id: 25070 



exercising its pooling rights hereunder, Lessee shall file of record a written declaration describing the unit and stating the effective 
T?i? I S? I, 5' P ^ ductl0n ' dnUu « or ^working operations anywhere on a unit which includes all or any part of the leased premises 
shall be treated as if it were production, drilling or reworking operations on the leased premises, except that the production on which 
Lessor s royalty is calculated shall be that proportion of the total unit production which the net acreage covered by this lease and 
included in the unit bears to the total gross acreage in the unit, but only to the extent such proportion of unit production is sold by 
Lessee. In the event a unit is formed hereunder before the unit well is drilled and completed, so that the applicable pooling criteria are 
not yet known, the unit shall be based on the pooling criteria Lessee expects in good faith to apply upon completion of the well- 
provided that within a reasonable time after completion of the well the unit shall be revised if necessaiy to conform to the pooling 
criteria that actually exists. Pooling in one or more instances shall not exhaust Lessee's pooling rights hereunder and Lessee shall have 
the recurring right but not the obligation to revise any unit formed hereunder by expansion or contraction or both, either before or after 
commencement ot production, in order to conform to the well spacing or density pattern prescribed or permitted by the governmental 
authority having jurisdiction, or to conform to any productive acreage determination made by such governmental authority To revise 
a unit hereunder, Lessee shall file of record a written declaration describing the revised unit and stating (he effective date of revision 
To the extent any portion of the leased premises is included in or excluded from the unit by virtue of such revision, the proportion unit 
production on which royalties are payable hereunder shall thereafter be adjusted accordingly. In the absence of production in paying 
quantities from a unit, or upon permanent cessation thereof, Lessee may terminate the unit by filing of record a written declaration 
describing the unit and stating the date of termination. Pooling hereunder shall not constitute a cross-conveyance of interests. 

7. Payment Reductions. If Lessor owns less than the rail mineral estate in all or any part of the leased premises, the royalties, and 
shut-in royalties payable hereunder for any well on any part of the leased premises or land pooled therewith shall be reduced to the 
proportion that Lessor's interest in such part of the leased premises bears to the full mineral estate in such part of the leased premises. 
To the extent any royalty or other payment attributable to the mineral estate covered by the lease is payable to someone other than 
Lessor, such royalty or other payment shall be deducted from the corresponding amount otherwise payable to Lessor hereunder. 

8. Ownership Changes. The interest of either Lessor or Lessee may be assigned, devised or otherwise transferred in whole or in part 
by area and/or by depth or zone, and the rights and obligations of the parties hereunder shall extend to their respective heirs, devisees, 
executors, administrators, successors and assigns. No change in Lessor's ownership shall have the effect of reducing the rights or 
enlarging the obligations of Lessee hereunder, and no change in ownership shall be binding on Lessee until sixty days after Lessee has 
been furnished the original or duly authenticated copies of the documents establishing such change of ownership to the satisfaction of 
Lessee or until Lessor has satisfied the notification requirements contained in Lessee's usual form of division order. In the event of the 
death of any person entitled to shut-in royalties hereunder, Lessee may pay or tender such shut-in royalties to the credit of decedent or 
decedent's estate at the address designated above. If at any time two or more persons are entitled to shut-in royalties hereunder. Lessee 
may pay or tender such shut-in royalties to such persons, either jointly, or separately in proportion to the interests which each owns. If 
Lessee transfers its interest hereunder in whole or in part, Lessee shall be relieved of all obligations hereafter existing with respect to 
the transferred interests, and failure of the transferee to satisfy such obligations with respect to the transferred interests, shall not affect 
the rights of Lessee with respect to any interests not so transferred. If Lessee transfers a mil or undivided interest in all or any portion 
of the area covered by this lease, the obligation to pay or tender shut-in royalties hereunder shall be divided between Lessee and the 
transferee in proportion to the net acreage interest in this lease then held by each. 

9. Release of Lease. Lessee may, at any time and from time to time deliver to Lessor and file of record a written release of this lease 
as to a full or undivided interest in all or any portion of the area covered by this lease or any depths or zones thereunder, and shall 
thereupon be relieved of all obligations thereafter arising with respect to the interest so released. If Lessee releases less than all of the 
interest or area covered hereby, Lessee's obligation to pay or tender shut-in royalties shall be proportionately reduced in accordance 
with the net acreage interest retained hereunder. 

10. Ancillary Rights. No well shall be located less than 600 feet from any house or commercial building now on the leased premises 
without Lessor's consent, and Lessee shall pay for damage caused by its operations to buildings and other improvements now on the 
leased premises. 

1 1 . Non-Surface Limitation. Lessee shall not conduct any surface operations upon any part of the surface of the leased premises. 
Lessee shall, however, have a sub-surface easement to horizontally drill under the surface of the leased premises, Notwithstanding 
anything contained herein to the contrary. Lessee shall have the right to conduct seismic operations, but only by utilizing the vibrosets- 
method. 

12. Environmental Safeguards. Lessee shall employ such measures as will reduce the impact of its operations upon improvements, 
vegetation and habitat on the leased premises. Lessee shall use reasonable care and safeguards in conducting its operations in or under 
the leased premises to prevent contamination or pollution from any waste, pollutant, or contaminant to any environmental medium, 
including soil, surface waters, groundwater, sediments, surface or subsurface strata, ambient air, or any other environmental medium 
in, on, or under the leased premises. Lessee shall remediate any condition which is hazardous to humans or wildlife resulting from 
Lessee's operations in or under the leased premises, 

13. Visual Appearance. Lessee shall not permit the disposal of trash, storage of used equipment or other such materials on the well 
sites and shall maintain the well sites in a neat and orderly fashion. Lessee shall construct or improve necessary lease roads as all 
weather roads and shall maintain such roads in a good state of condition and repair in order to prevent excess dust and erosion and 
maintain the continuity of the surrounding environment. For safety and appearance, Lessee shall install appropriate fences around each 
well and related facilities in a visually appealing manner in an effort to maintain the continuity of the surrounding area, and shall 
maintain the fences in a good state of repair. Upon conclusion of Lessee's drilling and completion operations, Lessee shall restore that 
portion of the well site not being utilized by Lessee for producing operations as nearly as is reasonably practicable to its original state. 
In addition, Lessee shall maintain the well sites in a manner whereby they shall be free of noxious vegetation and debris resulting from 
Lessee's operations. Upon lease expiration. Lessee shall remove all of Lessee's equipment and restore the surface of the ground as 
nearly as is reasonably practicable to its original state. 

14. Groundwater Protection. Any oil or gas wells drilled by Lessee shall be drilled in compliance with the surface casing 
requirements imposed by the State of Texas tor groundwater protection and Lessee shall install such surface casing in the required 
manner in order to insure the protection of all fresh waterbearing formations in and under the leased premises. 

1 5. Noise Abatement and Safety. Lessee shall utilize modem equipment with appropriate safeguards in its drilling, completion and 
producing operations. Whenever possible, Lessee shall install sound barriers and utilize hospital grade mufflers on compressors to 
reduce noise levels and emissions while conducting its operations in populous urban areas. 

16. Seismic Operations. Lessee shall pay for all damages incurred to the leased premises which result from its seismic operations. 
Other than seismic operations as provided herein, by execution and delivery of this Lease, Lessee does not otherwise obtain the right 
to conduct exploration, excavation or drilling operations from or upon the surface of any portion of the leased premises. 

17. Local Ordinances. In conducting its operations hereunder, Lessee shall comply with all ordinances, rules or regulations imposed 
by the City of Fort Worth or other governmental agency which are in effect as of the date of this lease. 

18. Regulation and Delay. Lessee's obligations under this lease, whether express or implied, shall be subject to all applicable laws, 
rules, regulations and orders of any governmental authority having jurisdiction, including restrictions on the drilling and production of 
wells, and regulation of the price or transportation of oil, gas and other substances covered hereby. When drilling, reworking, 
production or other operations are prevented or delayed by such laws, rules, regulations or orders, or by inability to obtain necessary 
permits, equipment, services, material, water, electricity, fuel, access or easements, or by fire, flood, adverse weather conditions, war, 
sabotage, rebellion, insurrection, riot, strike or labor disputes, or by inability to obtain a satisfactory market for production or failure of 
purchasers or carriers to take or transport such production, or by any other cause not reasonably within Lessee's control, mis lease 
shall not terminate because of such prevention or delay, and, at Lessee's option, the period of such prevention or delay shall be added 
to the term hereof. Lessee shall not be liable for breach of any provisions or implied covenants of this lease when drilling, completion, 
production or other operations are so prevented or delayed. Lessor hereby agrees that, in the event Lessee deems it necessary to seek a 
variance, waiver or other relief from any laws, rules, regulations, or orders (which for purposes of this paragraph shall include any 
ordinance) or other such authority exercised by (i.) the City of Fort Worth, including but not limited to the well setback distance for 
gas drilling and production, or (ii.) by any other governmental entity or authority having jurisdiction, then Lessor shall engage in 
reasonable acts and execute and deliver such instruments and documents Lessee deems necessary or convenient in seeking such relief. 
In the event Lessee is required by such authority to acquire Lessor's consent as a prerequisite to obtain such variance, waiver or other 
relief. Lessor grants to Lessee and agrees that Lessee's leasehold estate acquired hereunder includes the right to utilize this lease as 
Lessor's consent and ratification of any subsequent variance, waiver or other relief Lessee seeks, without the necessity of Lessee 



Project; River Trails 
Lease Id: 25070 



obtaining any additional or subsequent consent/s from Lessor. Lessor furthermore agrees not to execute documents or instruments or 
engage in acts that would diminish or adversely affect the relief Lessee is seeking. 

19. Lessee is hereby given the exclusive option to extend the primary term of this lease for an additional two (2) years from the 
expiration of the original primary term plus any extension of the primary term extended under any lease provision contained herein 
This option may be exercised by Lessee at any time during the last year of the original primary term, plus any extension periods by 

fSCS-JV^ '' ° r ' success0TS or asai V> s ' the sum of Six Thousand Six Hundred Sixty Seven and No./100 Dollars 

(16 667 00) per net mineral acre Lessee shall exercise such option by placing written notice of such election along with the payment 
in the U.S. Mail, postage prepaid, to Lessor at the above addresses, or by delivery of such notice and payment to Lessor, in either case 
prior to the end of the primary term hereof or if drilling operations are being conducted on the leased premises or upon lands pooled 
therewith at the expiration of the primary term in such manner as to maintain this lease in force, within thirty (30) days after the 
completion of the relevant operations. This option shall be deemed to be properly, timely and fully exercised if payment is forwarded 

S T! SC f i° I S J*? kn0W " addre$S on or the wpta*™ 0{ *e Primary term or any extension thereof, either by (i ) U S 
Mail, (u.) Overnight Delivery Service, or (iii.) by personal delivery. 

20 Breach or Default. No litigation shall be initiated by Lessor for damages, forfeiture or cancellation with respect to any breach or 
defeat by Lessee hereunder, for a period of at least 90 days after Lessor has given Lessee written notice fully describing the breach or 
detauit, and then only if Lessee fails to remedy the breach or default within such period. In the event the matter is litigated and there 
is a final judicial determination that a breach or default has occurred, this lease shall not be forfeited or cancelled in whole or in part 
unless Lessee is given a reasonable time after said judicial determination to remedy the breach or default and Lessee fails to do so 

2 1 . Warranty of Title. Lessor hereby agrees to defend title conveyed to Lessee hereunder, and agrees that Lessee at Lessees' option 
may pay and discharge any taxes, mortgages or hens existing, levied or assessed on or against the leased premises. Lessee agrees to 
pay for the costs of any hen subordination that Lessee may request from Lessor's lender. If Lessee exercises such option, Lessee shall 
be subrogated to the rights of the party to whom payment is made, and, in addition to its other rights, may not reimburse itself out of 
any royalties or shut-in royalties otherwise payable to Lessor hereunder. In the event Lessee is made aware of any claim inconsistent 
mth Lessor's title. Lessee may suspend the payment of royalties and shut-in royalties hereunder, without interest, until Lessee has 
been furnished satisfactory evidence that such claim has been resolved. 

22. Other than Lessors gross negligence or willful misconduct. Lessee agrees to indemnify and hold Lessor harmless from any and all 
liability, damages, reasonable attorney's fees, expenses, causes of action, suits, claims or judgments of any kind or character for injury 
to persons or property caused by Lessee's operations on the subject land. 



IN WITNESS WHEREOF, this lease is executed to be effective as of the date first written above, but upon execution shall be binding 
on the signatory and the signatory's heirs, devisees, executors, administrators, successors and assigns, whether or not this lease has 
been executed by all parties hereinabove named as Lessor . 

IN WITNESS WHEREOF this instrument is executed on the date first above written. 



LESSOR: Baxter Ray Rue, Jr. LESSOR: Michele Dene Rue 

Signature: W 1^4/^ %/ PhZV j^^// J. 

Signature. 

Individually and in all Capacities for tie above descfia& Land Individually and in all Capacities for the above described Land 
Title: Tit|e . (jgSSg*?- 




STATE OF TEXAS 

§ 

COUNTY OF TARRANT 5 



ACKNOWLEDGEMENTS 



This instrument was 



2008, by 



11:2 

%0\ <S> 



STATE OF TEXAS 



* OF 



COUNTY OF TARRANT 
This instrument was acknowledged before me on the 




2-5 



day of 



2008, by 



$Oz- o 
IX: * 



f 




Project; River Trails 
Lease Id: 25070 



EXHIBIT "A" 



ATTACHED TO AND MADE A PART OF THAT CERTAIN OIL AND GAS LEASE DATED 25 ^^t^yt^ 2 008 BY 
AND BETWEEN Baxter Ray Rue. Jr.. and wife. Michele Dene Rue AS LESSOR AND CARRIZO OIL & GAS, INC, AS LESSEE. 



LEGAL DESCRIPTION 



LOT 19. BLOCK 26. OF RTVER TRATLS A DDITION. PHASE HI. SECTTON 5. AN ADDITION TO 

THE CITY OF FORT WORTH. TARRAN T COUNTY 1 TEXAS. ACCORDING TO THE PI AT 
THEREOF RECORDED I N CABINET A. SLIDE^TIO'LAT RECORDS. TARRANT COUNTY. 

tfyac Vcm aiMb ~ 1 




Project: River Trails 
Lease Id: 25070 



Addendum 

I, DEFINITIONS 

As used herein, "River Trails" includes the area bordered by the following: 

North: by Trinity Boulevard; 
East: Precinct Line Road 
South: by Saranac Trail 
West: by Salado Trail 

Lessee shall hire an independent surveyor to conduct the survey, and shall pay all expenses associated with 
^survey. Attached hereto as Exhibit "B" is a map of the area comprising "River Trails" as defined 

E^iZ r nS i id » ?S St8ted abo u ve '„ UsS ° r agre6S "* d06S hereb y co^wmtizD their mineral interest 
in the River Trails Subdivision with all other mineral owners in the "River Trails" Subdivision entering 
into a Camzo lease which contains a similar communitization provision. Such communication shall be 
based upon a fraction with a numerator reflecting the amount of net mineral acres contributed by each 
respective communitizing Lessor and a numerator reflecting the total number of acres covered by the 
River Trails Subdivision which for the purposes of this provision shall be deemed to contain 297 acres of 
land, more or less. It is expressly understood and agreed, in the event all or part of the Lease is released 
and/or the Lease fully or partially expires, that each respective communitizing Lessor shall own their 
respective and separate mineral interest, which is so released or which expires, in the same manner and/or 
proportion as immediately prior to the date of execution of this lease as fully as though this lease had never 
been executed. Pooling all or part of River Trails Subdivision shall perpetuate the mineral interest covered 
by this lease pursuant to the pooling provision contained herein. Any non released and/or non expiring 
mineral interest cover by this lease shall continue to be administered as a communitized mineral interest 
under this provision. .